IRS launches paperless processing initiative

This announcement is <i>not</i> about the IRS pre-filling income tax returns, a topic that is discussed regularly on HN.<p>This is about handling all the <i>other</i> activities surrounding tax filing, such as getting copies of 3rd-party information returns (W-2s, 1099-Rs, etc), receiving and responding to notices regarding errors or questions in the previously filed tax return, etc.<p>California FTB (tax agency) set up an online system for taxpayers starting five or more years ago, with continuing enhancements since then. IRS is just now catching up, by providing the ability for a taxpayer (or tax practitioner with permission) to create a secure login account with access to their personal information.

Welcome to 21st century. Sincerely, the rest of the developed world.<p>I hope TurboTax and friends doesn&#x27;t manage to screw this one up.

Big thanks to y&#x27;all at the IRS and US Digital Service who are working on this.

&gt;Taxpayers will be able to digitally submit all correspondence, non-tax forms, and responses to notices;<p>Nice! I had to reply to a notice last year, and fortunately, I was able to respond to it &quot;digitally&quot;, but only via a workaround: since one accepted medium is fax, I used an e-fax service to send the response.[1] It definitely felt like there had to be a better way.<p>[1] Shout-out to faxrocket, featured on HN: <a href="https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=15484390">https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=15484390</a>

They currently don&#x27;t allow individuals to e-file unless they either:<p>1. Acquire commercial software, or; 2. Hire a paid preparer to file it, or; 3. Use &quot;Free File Fillable Forms&quot; (but this isn&#x27;t an option if you fall into one of the numerous special cases that it doesn&#x27;t support)<p>So, basically, mailing in a paper return is the only free option for some people (myself included).<p>I genuinely don&#x27;t understand why paid preparers can e-file directly with the IRS, but individuals can&#x27;t. There&#x27;s nothing in the linked article that says this will change, so if they go ahead and ban paper filing in a couple years, I&#x27;m not sure what options are left for people like me.<p>Yes, I can easily afford to shell out for software or a paid preparer if I really have to, but I&#x27;m very much against doing this on principle, since the whole tax prep industry in the US is a huge rent-seeking racket.

Are they going to be using MOVEit for our sensitive documents?

This would be a godsend! I&#x27;m not sure of its applicability to non-resident aliens yet, but having to mail the documents has been a really slow process. They don&#x27;t open them even after two months of receiving them, and then take another few weeks to process.<p>Going digital would at least alleviate the fears of having submitted the returns on time, since otherwise IRS doesn&#x27;t acknowledge them receiving on&#x2F;before time.

will this allow me to digitally file my amended federal taxes? That&#x27;s the one thing that I was looking forward to when I started reading this and possible may impact most taxpayers but looks like IRS still needs amended tax returns in a paper form being mailed out to them?

How about this: let’s go to a single flat rate for everyone and everything (say 20%) and eliminate all deductions except for a standard deduction (say whatever is the poverty line, eg $25000 or so). This would be for corporations and individuals.<p>Now your taxes can be filed on a postcard. And the IRS can preprint it and send it to you, with an online code or something to click “ok” on a web site and be done.<p>The government uses the tax code like a Swiss Army knife, trying to reward friends, punish enemies, encourage and discourage behaviors, etc. As a result we collectively spend millions of person hours and untold $$$ paying accountants to find and exploit loopholes and try and avoid undue attention.<p>Let’s just stop.

Finally, at least it&#x27;s promising that the process looks to be less bad

They’re getting scared. Trying to justify their paychecks.<p>Why do this now?

The UK has had online tax returns since 2001. It always amazes me how many things in the US still use paper.